Ben Bernanke’s Jackson Hole speech came and went this morning and the market reacted favorably. I have to agree with Josh Brown at The Reformed Broker that the build up has been ridiculous. I think some of the history just from last year’s meeting has been distorted as well. Of course the market is a discounting mechanism, but it seems that over the last few years it has attempted to discount on many things that have never and would never come to fruition. All of our short attention spans cause us to not want to wait until what happens in, say, the September Fed meeting. We want to trade on that news now, but there is no way to rightfully determine what will happen in September.
This way of thinking is how some stocks (read Bank of America in particular) have the worst case scenario currently built into their stock price, but the chance of that worst case scenario happening is slim. This way of thinking is probably good for us as value investors because there are more price to value discrepancies. I don’t think it’s good for overall investor confidence though.
Tiger Management’s Julian Robertson is always a great guru to keep an eye on. He keeps a pretty focused portfolio and always has well-thought out ideas. A GuruFocus article highlights some of his second-quarter buys. You can get the following three stocks cheaper than the second-quarter end of quarter price. That doesn’t mean that Robertson bought them at that price, but it is probably a good bet that these stocks trade significantly lower than the price that Robertson thinks they’re worth. Take a look at Teva Pharmaceutical, Concho Resources and AutoNavi Holdings.
With Hurricane Irene heading to the East Coast as we speak, I think it’s always interesting to see how incredibly awesome Walmart and Home Depot’s logistics are. Check out this NPR article describing their preparations.
At Home Depot's Hurricane Command Center in Atlanta, for example, about 100 associates have been trying to anticipate how Irene will affect its East Coast stores from the Carolinas to New York.
At times like this, the Command Center looks much like NASA Mission Control during a shuttle launch, says Russ Householder, the company's emergency-response captain.
"We've got all the key news agencies on the big screens up front," he says. "We're also monitoring our store sales so we can better be in tune to what's happening in our stores, and we're also connected live one-on-one with district managers in the impacted areas."
As the hurricane approaches, hopefully the hype of it will be more than the result, similar as Jackson Hole. Check out a few pictures from Business Insider of past hurricanes that hit New York, and stay on high ground.
Disclosure: Long Bank of America